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Takeover rumours don't spoil Aston Martin's party

PH gets to ask the Aston boss some awkward questions at St. Athan opening

By Mike Duff / Monday, December 09, 2019

There's a fine line between good news and bad, and one that can sometimes be spun either way. The fact a news article about Lawrence Stroll considering a bid to take a major stake in Aston Martin broke less than 24 hours before the company was due to open its St. Athan plant in Wales could be considered unfortunate timing. Yet its electrifying effect on the market also meant that Aston boss Andy Palmer got to go on stage at his spiffy new factory with the company's share price higher than it had been since the big slump in July. Swings and roundabouts.

Nobody at Aston was denying Autocar's story - that Stroll is hoping to head a consortium to take advantage of Aston's low share price and ultimately gain control of the company. The Canadian billionaire has already displayed both deep pockets and a love of fast cars with his takeover of what used to be the Force India F1 team, now Racing Point, which is son Lance drives for.

But nor was there any confirmation to be found at St Athan, just flat "no comments" from CEO Andy Palmer downwards. As a publicly quoted company Aston is seriously restricted in terms of saying things that could move the market. "It's a rumour," said Palmer, when PH grabbed ten minutes with him, "we're a public company, I can't speculate on rumours."

Yet if Stroll or another raider has serious ambitions on taking control of Aston Martin, there are some serious hurdles to overcome. The first being the fact that only around a quarter of the company's stock is in "free float" and available to buy, given the substantial stakes already held by Italian group Invest Industrial and the Kuwait based Adeep/ Primewagon group, which between them still control well over half of it. Daimler also has four percent.

Any attempt to combine Aston with Racing Point, or even to rebrand it as a full Aston works effort, could also get seriously complicated, Palmer emphasising that Aston's title sponsorship of Red Bull Racing is signed until at least the end of next season.

While he wouldn't talk about any takeover, Palmer was willing to discuss both his frustration with the falling share price and his plans for turning the company around. "I suppose it's fair to say there was a significant part of the investment community that didn't believe we could get here, and which doesn't believe we can get to the launch of the [DBX] and delivery of the plan," he said.

"In consequence we've got quite a high short - which is looking at the short term and betting against us. That is frustrating but the only way to deal with it is to deliver the car. Until I announce how many orders we've got and you see the factory spitting cars off the end of the line you're going to continue to have people bet against you."

It's really not hyperbole to say that the DBX is the most important vehicle that Aston has ever launched. Having already resorted to a bond issue (007 pun intended) to get its DBX finished, the company's future rests on its success. To his frustration, Palmer is prevented from sharing order numbers yet, but the signs look positive: "we've got all of our U.S. dealers here for the factory opening," he said, "they are usually the most hard-nosed people in the community, but I've never seen them as happy as they are now."

When asked if he stood behind his previous predictions that Aston will build up to 5,000 DBX a year, and average around 4,000 over the life of the car, Palmer said "I don't see any reason to change that prognosis."

But St. Athan also proves the depth of the company's commitment to both the DBX and the pure electric Lagonda models that will ultimately be built in Wales. The idea of using repurposed aircraft hangers to produce cars might create the mental image of something a bit lashed together, but the reality has to be one of the most modern car factories in Europe, as well as the newest. This isn't going to have cars pushed between stations on dollies or skids like most low-volume makers, rather an entirely proper automated production line that will carry the DBX around the vast site, including several transitions between different floors on smart lifts and a parts warehouse that looks like an Amazon Fulfillment Centre.

It's also genuinely humbling to talk to some of the workers who have been taken on in a part of the world that is getting short of skilled, highly-paid jobs and discover what working for Aston means for them. The "Made in Wales" plates that the DBX will wear represent every bit as much pride as the "Made in England" ones on the rest of the range do.

When running at full crank, St. Athan will be producing a DBX every thirty minutes, with each one representing a much-needed six-figure infusion into the company's coffers. Believe that will happen - and the world does seem keen on ultra-posh SUVs - and Palmer's confident assessment becomes easier to accept.

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